THE DEVELOPMENT Budget Coordination Committee (DBCC) trimmed its tax revenue projections for this year, as it cut the Bureau of Internal Revenue (BIR) target by 1% amid expectations of slower economic growth.

Data from the DBCC showed it cut its overall revenue projection for 2026 by 0.33% to P4.807 trillion, equivalent to 15.78% of gross domestic product (GDP), from the P4.823 trillion or 15.8% of GDP approved during its 192^nd meeting in December.

The revised projection is also 3.5% lower than the P4.983-trillion program under the 2026 Budget of Expenditures and Sources of Financing.

Tax revenues are now expected to account for P4.442 trillion or 92.4% of total revenues this year, 0.7% lower than the P4.474 trillion projected in December.

For the BIR, its collection target for this year was lowered by 1% to P3.393 trillion from P3.43 trillion previously. However, BIR collections are still expected to account for about 76.4% of total tax revenues.

Finance Undersecretary Rolando T. Ligon, Jr. said the lower target mainly reflected the ambitious goal set last year.

“Actually, if you look at the year-on-year collection, the BIR collections have increased. Unfortunately, the set target was 25% more than the last year,” he told reporters on Wednesday.

Last year, the BIR collected P3.109 trillion in revenues, up 9% from the previous year. If the revised projection is realized, BIR’s collection will increase by 9% this year,

In the first five months, BIR collections rose by 5.5% year on year to P1.434 trillion, and 0.7% above the P1.424-trillion target for the period.

The DBCC had tweaked its revenue collection targets after it lowered the GDP growth projection to 3.5-4.5% this year from 5-6% previously.

“Growth is expected to moderate this year amid heightened domestic and external uncertainties, including the lingering effects of governance-related issues, geopolitical tensions in the Middle East, and other global developments affecting business and consumer confidence,” the DBCC earlier said.

Meanwhile, the DBCC raised the Bureau of Customs’ (BoC) revenue collection target by 0.7% to P1.011 trillion this year from P1.003 trillion previously.

Mr. Ligon said the higher BoC revenue projection reflected the agency’s efforts to boost collections, as well as the weaker peso against the US dollar.

In the first half, BoC collections rose 7.2% to P491.75 billion, and exceeded the P480.27-billion target for the period by 2.4%.

The local currency has been trading above the P61-per-dollar mark since June 22. On Thursday, the peso closed P61.605 against the greenback, weakening by 10 centavos from its P61.505 finish on Wednesday.

Mr. Ligon also said the BoC also remained on track to hit its target this year, despite the three-month suspension of excise taxes on kerosene and liquefied petroleum gas (LPG).

The government suspended excise taxes on kerosene and LPG beginning April 17 to provide relief for consumers after oil prices surged due to the conflict in the Middle East. The Department of Finance (DoF) estimated the measure reduced revenues by about P2.5 billion over the three-month period.

The government lifted the suspension this week after the Department of Energy certified that the average Dubai crude oil price in June fell to $79.45 per barrel, below the $80 threshold that triggers the temporary tax relief.

Finance Secretary Frederick D. Go said the DBCC could again recommend suspending the excise taxes should average Dubai crude prices rise above $80 per barrel.

“We can again make a recommendation (to the President) to reduce or suspend the excise taxes,” he said.

While tax revenue projections were revised downward, the DBCC raised its nontax revenue forecast by 4.3% to P365.1 billion from P349.9 billion previously. — Justine Irish D. Tabile